Bank of NY Mellon sued by Ohio over forex practice

Reuters News
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Posted: Mar 12, 2012 5:38 PM
Bank of NY Mellon sued by Ohio over forex practice

(Reuters) - Bank of New York Mellon Corp was sued on Monday by Ohio's attorney general, who accused the custodial bank of overcharging state pension funds on foreign currency exchange transactions.

Mike DeWine, the attorney general, filed the lawsuit in an Ohio state court on behalf of the Ohio Police & Fire Pension Fund and the School Employees Retirement System of Ohio, seeking more than $16 million of damages.

A spokesman for the bank had no immediate comment.

Bank of New York Mellon faces many lawsuits, as well as state and federal probes, into allegations it overcharged state and local pension funds on currency transactions, by setting unfavorable prices that let it profit at the funds' expense.

State Street Corp, one of the bank's main rivals, has faced similar allegations.

New York Attorney General Eric Schneiderman in October said that Bank of New York Mellon cheated clients out of about $2 billion over roughly a decade from the practice.

The case is Ohio Police & Fire Pension Fund et al v. Bank of New York Mellon Corp et al, Court of Common Pleas, Franklin County, Ohio.

(Reporting By Jonathan Stempel; Editing by Steve Orlofsky)